How does filing for Bankruptcy complicate a HBS

You must be logged in to reply to this topic.

Viewing 8 posts - 1 through 8 (of 8 total)
  • Posts
  • It’s great to get called into a situation at the very last minute. I got contacted this past weekend to see how I can come to the rescue (don’t ya’ll like being miracle workers?) however she wouldn’t meet me Sat night or Sun and then at 7pm tonight finally calls and wants to meet tomorrow. Since I was only about 20 mins from her house, I said I’ll be over in half an hour.

    Background: The lady bought the 3/2.5 nice house for $190k cash in a desirable neighborhood in 2008 & is about to lose her home to a HELOC foreclosure.

    2012 ARV: $150k
    Repairs: $15k Carpet, paint, refrig, and add granite countertops in kitchen & baths

    Situation: $9k in arrears to stop the foreclosure on Weds
    Balance owed on HELOC: $35k
    Conservative MAO if I were rehabbing (which I won’t be) is $82.5k

    She’s tried family and friends to get the $9k needed to call off the foreclosure sale on Weds (just over 24 hrs from now). She has one more family member who may be able to help and if not she plans to have an attorney file a BK tomorrow to stall the sale so she can have a chance to sell the house to get something back.

    I feel like I’m in the picture too late to do much if she can’t get a family member or friend to help her stop the foreclosure since she wants a little money. She likes the idea of an HBS at $45k strike & 50/50 thereafter.

    How does a BK complicate selling with an HBS? Does the BK trustee have to be involved?

    PS – Had she contacted me even last Th or F, I had several options available however this foreclosure time crunch is killing me. By my not pushing her to meet on Sat night or Sun I wasted today as a workday to coordinate some actions. Numbers are good for an HBS or wholesale but time is against me. Any other thoughts/ideas folks?



    sounds like bankruptcy is her only option to stop the sale & give you time to work your magic!

    it is easy to get permission from the bankruptcy trustee to hold a highest bidder sale. no problem.

    The BK will buy you at least 30-45 days

    go for it

    after to get this one sold, you need to go to the bank with the HELCO and tell them you can solve all their delinquent problems if they will put you in touch with all the people who are behind. They won’t do it, but they may give your name to the people and suggest that they call you for a solution.

    Figured there would be an easy solution. Thanks. Will let all know how it goes.

    Update: the home went into bankruptcy. She can’t enter into any written agreements on the house for 6 wks per her attorney. Sounds like they are meeting with the BK trustee then.

    So sad…she paid 190k cash and may lose it because she of that 35k HELOC. Is she living in the house? If not then maybe have someone come in with 15K down and do a owner finance….9k to get the HELOC up to date and the other 6K…for you or what ever. If possbible get sandwiched into the monthy payments. Please correct me if this would not be a good idea if the circumstances allowed.


    Your idea may have worked if the lady had contacted me with more than 2 work days prior to the foreclosure sale. Unfortunately in that county, a title search takes 2 days at best to get results. I wouldn’t put any of my or a private lenders money at risk without it. Plus, one objective of mine is to stay out of the chain of title.

    The bankruptcy puts a new bureaucratic step in the sales process. The BK trustee must approve all sale actions at this point. The BK trustee will be looking to satisfy the entire debt since there is equity sitting in the house. HBS will be the best way to show the court that the house has been offered for sale, and it is about as creative as my local RE attorney thinks will be allowed. Otherwise it will get listed with an agent and sit and sit……..


    A title report could reveal more than a HELCO. There could be an IRS lien, another loan she failed to mention, code violation liens, judgements, etc etc. You should never ever put more than at most $100 at risk unless you have a preliminary title report so you know what kind of mess you’re getting in to.

Viewing 8 posts - 1 through 8 (of 8 total)

You must be logged in to reply to this topic.